Comparing Transformational, Contingency, and Transactional Leadership Theories

Subject: Management
Pages: 2
Words: 664
Reading time:
3 min
Study level: College
Leadership Theories Transformational Leadership Contingency Leadership Transactional Leadership
History It was started in 1973 by James V. Downton and expanded upon by James McGregor Burns in his book “Leadership” in 1978(Steinmann et al., 2018). The concepts surrounding the theory were further expanded to include techniques for success measurement by Bernard Bass in 1985. It was developed by Austrian scientist and psychologist Fred Edward Fielder in 1964(Vidal et al., 2017). He introduced the theory officially in his article, “A Contingency Model of Leadership Effectiveness.” It was developed in 1947 by Max Weber and expanded by Bernard Bass in the early 1980s, who also played a crucial role in transformational leadership theory development (Hussain et al., 2017).
Definition of Theories It refers to a leadership style wherein the leaders are the key figures of inspiration, encouragement, and motivation to enhance employee innovation and establish changes focused on growth and shaping a company’s future success (Steinmann et al., 2018). Therefore, a leader’s behavior is key to influencing the employees to boost performance beyond perceived capabilities. It claims that the best way to make decisions, organize a corporation, or lead a company is nonexistent. Thus it proposes that a course of action’s contingency depends on the external and internal situation (Vidal et al., 2017). Therefore, such leaders portray flexibility in choice and adaptation to suit alterations in cases in their leadership. Thus, according to the theory, an individual’s effectiveness as a leader depends on the situation and the extent to which it is suitable to their suitable style. It refers to the notion that the relationship between managers and employees is based upon giving and taking, wherein managers provide employees with the particular thing they want to get whatever they want(Hussain et al., 2017). It claims that instruction, structure, and monitoring are essential components in completing tasks since employees lack self-motivation.
Elements They are intellectual stimulation, idealized influence, individualized consideration, and inspirational motivation (Steinmann et al., 2018). They include leadership authority, leader’s acceptance, and the extent of employee’s job description (Vidal et al., 2017). They include active and passive management by exception, contingent rewards, and laissez-faire (Hussain et al., 2017).
Organizational Change It is essential to assist an organization in improving and providing individualized care to clients based on claims and services needed (Steinmann et al., 2018). It provides organizations with the ability to learn from given situations and allows them to integrate the lessons to mitigate against similar conditions faced in the future (Vidal et al., 2017). It allows organizations to have a strict set of rules that provide enforcement and pushes employees to focus on delivering their best to avoid punishment (Hussain et al., 2017).
Nature It is proactive. It is reactive. It is responsive.
Area of Concern It is concerned with change to an organization. It is concerned with particular situations faced by leaders. It is concerned with a leader’s status quo.
Advantages They include the provision of unison for a common cause, reduction of turnover costs, change creation and management, maintain the organization’s ethical guidelines and openness, motivation promotion through communication, and provision of employee freedom (Steinmann et al., 2018). They include flexibility, enhancement of decision-making skills, enhances organizational planning and structure, and provides employees with options that stimulate growth by sharing ideas (Vidal et al., 2017). They include fairness, a simple and understandable system, ease in employee evaluation, production increase and costs reduction, and confusion in the command chain (Hussain et al., 2017).
Disadvantages They include loss of leadership power with disagreements, a requirement of a constant feedback loop, potential for employee abuse, risky and disruptive, and employee burnout (Steinmann et al., 2018). They include its complexity, reactive nature, and inadequacies in literature since it is insufficient to claim that leadership actions depend on the situation (Vidal et al., 2017). They include difficulty establishing motivational rewards for all employees, lack of focus on building relationships, lack of long-term vision, discouragement of creativity, and an inappropriate approach to leadership development (Hussain et al., 2017).


Hussain, S., Abbas, J., Lei, S., Jamal Haider, M., & Akram, T. (2017). Transactional leadership and organizational creativity: Examining the mediating role of knowledge sharing behavior. Cogent Business & Management, 4(1), 136-166. Web.

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Steinmann, B., Klug, H., & Maier, G. (2018). The path is the goal: How transformational leaders enhance followers’ job attitudes and proactive behavior. Frontiers In Psychology, 9, 23-38. Web.

Vidal, G., Campdesuñer, R., Rodríguez, A., & Vivar, R. (2017). Contingency theory to study leadership styles of small businesses owner-managers at Santo Domingo, Ecuador. International Journal Of Engineering Business Management, 9, 184-197. Web.